7 Dec: US$, stocks firm but rangebound. WTI lower. markets looking towards ECB, tomorrow, FOMC next week.

By | December 7, 2016

It has been a relatively stable session on Tuesday with stocks and commodities both trading flat while the US$ has recovered mildly as traders cautiously wait on the ECB meeting on Thursday and then on the FOMC meeting, due next week. The ECB are expected to keep policy on hold although there is a chance that they could extend the current QE programme while Fed fund futures are pricing in a 95% chance of a Fed hike next week and then a 50% chance of another hike by June.

Wednesday kicks off with some words of wisdom from the RBNZ Governor, Wheeler and the Australian AIG Performance of Construction Index, which comes ahead of the important Q3 GDP at which a soft outcome is expected. Expectations range from +0.2% to -0.3% and the lower end of that would bring forward thoughts of an early 2017 rate cut, placing some downside pressure on the Aud. Later on the UK gets to see the Manufacturing/Industrial Production for October and the NIESR GDP Estimate for November. From the US we get the EIA Crude Oil Stocks Weekly Change and the Consumer Credit (Oct), while Canada will have an Interest Rate Decision to contend with

CURRENCIES
EURUSD: 1.0714
Res  1.0750  1.0795  1.0820
Sup  1.0685  1.0650  1.0615
USDJPY: 114.03
Res  114.20  114.60  114.85
Sup  113.65  113.35  113.00
GBPUSD: 1.2677
Res  1.2700  1.2730  1.2775
Sup  1.2655  1.2625  1.2600
USDCHF: 1.0105
Res  1.0115  1.0140  1.0180
Sup  1.0050  1.0010  0.9985
AUDUSD: 0.7456
Res  0.7480  0.7500  0.7520
Sup  0.7430  0.7415  0.7400
NZDUSD: 0.7110
Res  0.7135  0.7160  0.7185
Sup  0.7095  0.7070  0.7045
INDICES / COMMODITIES
S+P: 2208
Res  2210  2214  2220
Sup  2200  2190  2180
DJI: 19215
Res  19250  19275  19300
Sup  19175  19140  19100
ASX SPI: 5458
Res  5460  5476  5500
Sup  5422  5400  5380
GOLD: 1168
Res  1180  1188  1198
Sup  1158  1150  1140
SILVER: 16.70
Res  16.90  17.00  17.25
Sup  16.50  16.30  16.15
OIL (WTI): 50.73
Res  51.40  52.40  53.00
Sup  50.15  49.20  48.50

 

Indices/commodities
S&P Futures 2208

The S+P had a rangebound session (2200/09) leaving the outlook unchanged

Further choppy sideways trade seems to be the overall theme, but with the dailies still looking unconvincing on the topside we could yet head a bit lower, and below 2200 could revisit today’s 2190 and then the previous session low of 2078. Under here would allow 2170 to be tested and further out we could see 2140/50 although unlikely. On the topside, back above 2209, resistance will arrive at the 2213 all-time high, above which we might expect the slow grind higher to continue, towards 2220. With the weeklies apparently trying to turn higher, a slow grind to the topside again seem to be the most likely outcome although the dailies do still suggest dips, providing slightly better levels to buy into.

24 Hour: Neutral Medium term: Neutral

 

                                         Resistance Support
2225 Minor 2190 Minor
2220 Minor 2178 5 Dec low/21 Nov low
2215 Minor 2169 (23.6% of 2028/2213)
2213 30 Nov high  / All time high 2160 Minor
2208 Session high 2150 Minor
DJI Futures 19215
Ditto S+P. the DJI The DJI had a rangebound session (19175/19232) leaving the outlook unchanged. Buying dips remains preferred, looking for the slow grind higher to continue, although ahead of next week’s FOMC Meeting, it may be that we continue t track sideways.
24 Hour: Neutral Medium term: Neutral

 

Resistance Support
19500 Minor 19175 Session low
19400 Minor 19140 200 HMA
19350 Minor 19080 5 Dec low
19300 Minor 19041 28 Nov low
19275 5 Dec high/All time high 18973 23 Nov low
ASX SPI 5458

The ASX has had a rangebound session (5422/5458) leaving the outlook unchanged.

The daily momentum indicators appear to suggest further choppy, sideways trade, where back above 5460, both 5480 and 5500 would provide topside resistance. Above 5500, (unlikely today), would meet the 5517, 28 Nov high and the 25 Nov high of 5527. Beyond there though, further gains will find little to stop the SPI heading on to the August high of 5568, which should be strong resistance but beyond which could see a run to 5600 and above, and then we could then see a run towards the August 2015 high at 5671.

On the downside, back below the session low of 5422 would again see buyers at 5400 and again at 5380.  The short term momentum indicators appear mildly positive but it will be the GDP figure that decides the direction.

24 Hour: Neutral Medium term: Neutral

 

Resistance Support
5540 Minor 5422 Session low
5527 25 Nov high 5400 Minor
5500 Minor 5381 5 Dec Low
5475 Minor 5350 Minor
5458 Session high 5335 (38.2% of 5029/5527)
GOLD 1168

Gold has had a rangebound session (1166/1175) leaving the outlook unchanged

Another downside test would again find bids above 1160 and at the 1157 recent lows, but below which there is little to hold the price up until 1120. On the topside as before, resistance will be seen at 1180 (minor), at the 5 Dec 1188 high and then again in the 1195/1200 area although this looks unlikely to be seen for a while. Given that the weeklies point lower I still prefer to trade strategically from the short side although the dailies may be looking to find a near term base, suggesting another rangebound 5 Dec ahead.

24 Hour: Neutral Medium term: Prefer to sell rallies

 

Resistance Support
1199 (23.6% of 1337/1157) 1166 Session low
1197 28 Nov high 1157/5 Dec low 4 Feb low
1188 5 Dec high 1140 Minor
1180 200 HMA 1130 Minor
1175 Session high 1122 (76.4% of 1046/1375)
SILVER 16.70

Silver traded sideways today (16.68/89) leaving the outlook unchanged.

Once again, the short-term momentum indicators are flat and we could be in for further choppy trade today. As we said before, it could be that Silver is building a base, with resistance seen at 16.85/95, but which, if broken could see a run towards 17.50 although if we do head up there, this area would suggest a medium term sell opportunity. In the meantime, below Monday’s low of 16.48 could see another test of the 2 Dec low of 16.31. Below that would eventually open the way to the minor double bottom at 16.16 and possibly 16.00, beneath which would allow a run towards 15.80 and potentially to 15.40.  I still prefer to trade from the short side although leave room for a short-term squeeze towards 17.50 before jumping in too heavily.

24 Hour: Neutral Medium term: Prefer to sell rallies

 

Resistance Support
17.50 Minor 16.68 Session low
17.35 Minor 16.48 5 Dec low
17.23 (38.2% of 18.98/16. 17)/16 Nov high 16.31 2 Dec Low
16.97 5 Dec high 16.16 25 Nov Low/23 Nov low
16.85 (23.6% of 18.98/16. 17)/Session high 15.81 1 June low
OIL (WTI) 50.73

WTI traded lower on Tuesday for the first time since OPEC agreed to limit its production last week by about 1.8 million bpd, or 2% of the total world output. Some cracks seem to be creeping into the deal and various analysts are beginning to hint that various member countries (Iran/Iraq) could have a hard time sticking to their plan.

WTI has traded down to 50.26 and with the 4 hour momentum indicators we could see further pressure towards 50.00 and below. Despite breaking above the long term head/shoulders neckline of 51.30, in reaching 52.38 on Monday WTI has been unable to build on the momentum and so a neutral stance is now required.The dailies still look positive so buying dips remains the overall theme and as long as we remain above 50.00 I am happy to be long although below there I would be nervous of doing so and would therefore have a tight stop in place as we could then see a run towards 48.50.

As we said previously, the head shoulder formation, seen in the weekly charts, would have an objective of 82.00 and given the positive momentum seen in the dailies further upside action still looks possible. Nearer home, if we do head higher, the current session high of 51.57 will see offers ahead of the 5 Dec high of 52.38. Beyond that the next level to watch would be at 53.50.  Don’t forget that OPEC & non-OPEC countries will meet on December 10 in Vienna and until then it could just remain choppy in the 50/52 range.

24 Hour: Neutral Medium term: Mildly bullish

 

Resistance Support
54.00 Minor 50.26 Session low
53.52 9 July 2015 high 50.16 2 Dec Low
53.00 Minor 50.00 (23.6% of 42.19/52.38)
52.38 5 Dec high 49.00 Minor
51.57 Session high 48.55 (38.2% of 42.19/52.38)

EURUSD: 1.0714

The Euro was unable to carry its positive momentum into Tuesday and has spent the session drifting slowly back towards 1.0700 against the dollar, roughly where it is currently sitting.

The momentum indicators are now rather mixed and it would seem likely that we have a generally choppy, but probably rather directionless session ahead of us as we await tomorrow’s ECB Meeting. There is not a lot of data due today to provide any direction and it would not therefore really surprise if the Euro is sitting at close to currently levels this time tomorrow. If wrong, on the topside, we could see another squeeze towards1.0800, above which, decent resistance lies in the 1.0800/20 area, but above here could see a run towards 1.0900, which again should be strong but above which could open the way to 1.1000.

The downside will see bids at the various minor Fibo levels of the  previous session’s spike higher, ahead of the Monday low support at 1.0504, with the first level being not so far away, at 1.0685 and then again at 1.0615 and 1.0575. Further out, below 1.0500 would eventually open the way to the March 2013 low at 1.0461, beneath which there is very little to hold the Euro up until we reach almost to parity (1.0070=61.8% of 0.8225(Oct 2000 low)/1.6037(July 2008 high)), with minor levels ahead of that seen as per the table below.

While the shorter term momentum indicators look positive, I still prefer to sell into strength.

24 Hour: Neutral  – Mildly bearish Medium term: Prefer to sell rallies

 

Resistance Support
1.0855 Minor 1.0697 Session low
1.0816 15 Nov high 1.0685 (38.2% of 1.0504/1.0796)
1.0806 (38.2% of 1.1300/1.0505) 1.0615 (61.8% of 1.0504/1.0796)
1.0796 5 Dec high 1.0575 (76.4% of 1.0504/1.0796)
1.0750 Minor 1.0504 5 Dec low

Economic data highlights will include:

German Industrial Production, EIA Crude Oil Stocks Weekly Change, Consumer Credit

Meta Trader
EURUSD: 4 Hour

euro


USDJPY: 114.03

US$Jpy is back at 114.00 after a choppy session of trade between 113.50/114.20, leaving the outlook unchanged.

The short term momentum indicators are completely flat so another rangebound session looks possible today although, as before, the daily charts remain at overbought extremes so further corrections would not surprise. The initial support will again be seen at 113.50, below which, minor support will arrive at 113.20 and then again at 113.00 and at the 112.85 5 Dec low, but below which there are only minor support levels below this until 112.00.

On the topside sellers, will be seen at 114.20, 114.60, at the 5 Dec high of 114.76 ahead of the 114.82 trend high. Above that, there is good option protection ahead of 115.00 but above which there is little to stop the dollar heading on to 115.50/60. Further out, a break of this level could then see a run towards 116.00 and even to 117.80 (76.4% of 121.05/98.94). For the time being, trading cautiously from the short side, selling into rallies above 114.00, seems to be the plan but further out, heading into 2017, I suspect that we have further dollar strength ahead of us.

24 Hour: Neutral Medium term: Neutral – Prefer to buy dips

 

Resistance Support
115.00 Psychological 113.50 Session low
114.82 2 Dec high 113.35 200 HMA
114.75 5 Dec high 113.00 Minor
114.60 100 DMA 112.86 5 Dec low
114.18 Session high 112.50 Minor

Economic data highlights will include:

Leading Economic Index, Coincident Index

Meta Trader
USDJPY: 4 Hour

yen


GBPUSD: 1.2677

Cable has run out of steam on the topside for the time being and after reaching 1.2774, it is now back towards the day’s lows of 1.2655, with US$ strength and profit taking on long Sterling positions seemingly responsible for the move.

While the daily charts still look positive, the short term momentum indicators have turned lower so a more cautious stance is required, for what may be a choppy, sideways session ahead as we wait on the ECB Meeting. If the dailies are correct, then another rally back above 1.2700 would see minor resistance at 1.2740 ahead of the 1.2774 trend high, beyond which, further sellers will arrive at the 100 DMA at 1.2785.  On the downside, minor support exists at the session low of 1.2655 and then again at the previous day’s low of 1.2626, a break of which could see us back at the 2 Dec low of 1.2570. Buying dips remains the overall theme as long as the dailies remain constructive, while being aware of Brexit headlines coming from the courts.

24 Hour: Neutral – Mildly bearish Medium term: Prefer to buy dips

 

Resistance Support
1.2800 Minor 1.2655 Session low
1.2785 100 DMA 1.2626 5 Dec low
1.2774 Session high 1.2600 Minor
1.2740 Minor 1.2570 2 Dec Low
1.2700 Minor 1.2548 (23.6% of 1.1821/1.2774)

Economic data highlights will include:

UK High Court Brexit Appeal Continues, Manufacturing/Industrial Production

Meta Trader
GBPUSD: 4 Hour

gbp


USDCHF: 1.0105

US$Chf has had a fairly rangebound session although the dollar has recovered from the previous day’s lows, but leaving the overall outlook unchanged.

A cautious stance is required, and on the downside the session low at 1.0049, if seen, will provide decent support, below which, a test of parity would possible. Under there could see a run towards 0.9950/55 but seems unlikely. If the dollar continues to head higher, then beyond the session high could see a move to 1.0140 and to the 5 Dec high at 1.0181. With the weekly charts still looking positive, we could eventually be in for a sterner test of 1.0200, beyond which could then head on to 1.0250 and to 1.0300/25 at some stage.  For the time being the dollar looks heavy, although I still think that eventually we are going to rebound for another test of the trend highs, albeit probably not today.

24 Hour: Neutral Medium term: Neutral – Prefer to buy dips

                                                                

Resistance Support
1.0223 2 Feb high 1.0080 Minor
1.0204 30 Nov high 1.0048  (23.6% of 0.9548/1.0204)/Session low
1.0181 5 Dec high 1.0000 Psychological
1.0140 200 HMA 0.9955  (38.2% of 0.9548/1.0204)
1.0115 Session high 0.9925 Minor

Economic data highlights will include:

CPI

Meta Trader
USDCHF: 4 Hour

chf


AUDUSD: 0.7456

The Aud had a rangebound session leaving the outlook unchanged as we wait on today’s Q3 GDP, with some analysts now looking for a negative print of up to -0.5%, which,  if delivered may push the Aud back below 0.7400. The more general view is that the data will be 0.0%, possibly even +0.3%, which would be the surprise result and would take the Aud higher. All rather ‘toss of the coin’ stuff, so a neutral stance is required.

Technically, the short term momentum indicators are now flat, while daily charts still appear to have some mild upside momentum and the chance of further probes to the topside. If so, above the 0.7480 high will find good sellers at 0.7495/7500, but a break of which there is then not too much to stop it heading on towards 0.7545/50 although I don’t really see it there today and would prefer to sell into any strength on approach, with a SL place above 0.7560. On the downside, minor support now lies at 0.7430 and then at 0.7400, a break of which could then head back to the recent support at 0.7360/70. Under there could then see a move towards 0.7335 and then to 0.7300/10 although this looks over the horizon in the near term. Wait for the GDP and then go with the flow. I suspect the number is going to come in at a fairly neutral 0.0%, which could mean more choppy trade ahead.

24 Hour: Neutral 24 Hour: Prefer to sell rallies.

 

Resistance Support
0.7570 16 Nov high 0.7430 200 HMA
0.7542 50% pivot of 0.7777/0.7310 0.7411 5 Dec low
0.7510 Minor 0.7400 2 Dec Low
0.7496/97 29/30 Nov high/5 Dec high 0.7363/61 24 Nov low/22 Nov low
0.7482 Minor 0.7345 Minor

Economic data highlights will include:

AIG Performance of Construction Index, Q3 GDP

Meta Trader
AUDUSD: 4 Hour

aud


NZDUSD: 0.7110

The Kiwi took a brief dive from 0.7160 to 0.7093 yesterday when it found a black hole of liquidity, but quickly recovered and then spent the rest of the day sagging back towards the lows, currently sitting just above 0.7100. The improved GDT (Price Index +3.5%, WMP 4.9%) did nothing to help the Kiwi.

While the daily momentum indicators still look mildly constructive the short term momentum indicators have run out of steam and look rather flat, so a choppy session may lie ahead, with the Kiwi taking its direction today from the Aud, after the release of the GDP data. On the topside, resistance will be seen at 0.7140 and again at 0.7160. Above there, which seems unlikely today, a move towards 0.7185 would then be possible, a break of which could see a move to 0.7200+, although doubtful for a while.

On the downside buyers will again be seen below 0.7100, at 0.7085/90 and at the 5 Dec lows around 0.7070. Under there, look for another run towards 0.7035, where the 200 DMA previously propped it up.

24 Hour: Neutral Medium term: Prefer to sell rallies

 

Resistance Support
0.7200 Minor 0.7093 5 Dec low
0.7185 (50% of 0.7400/0.6983)/100 DMA 0.7085 Minor
0.7160 Session high 0.7068 5 Dec low
0.7145 Minor 0.7043 2 Dec low
0.7130 Minor 0.7035/32 200 DMA

Economic data highlights will include:

RBNZ Governor, Wheeler Speech.

Meta Trader
NZDUSD: 4 Hour

nzd

The post 7 Dec: US$, stocks firm but rangebound. WTI lower. markets looking towards ECB, tomorrow, FOMC next week. appeared first on FX Charts Daily.